IAWS reports 18% rise in interim profits to #15.2m

Food and agri-business group IAWS has appointed consultants to help develop its Internet strategy, it said yesterday when it announced strong results for the six months to end January.

Reporting an 18 per cent rise in interim profits before tax and exceptional gains to #15.2 million, the group forecast "another good result" for the full year.

IAWS was examining possible e-commerce opportunities in all of its business divisions, finance director Mr David Martin said.

"We are looking at possible efficiencies in business to business transactions and customer transactions as well as any opportunities that we could take advantage of," he said.

When the exceptional gain of #7.5 from the sale of the 1.5 acre dock milling site at Barrow Street in Dublin is included, group pretax profits were 76 per cent ahead at #22.7 million. The Barrow Street sale was delayed due to High Court proceedings taken by Treasury Holdings - these claims have now been withdrawn, IAWS said yesterday.

IAWS is currently adding flour milling capacity with the construction of a new £20 million mill in Dublin which will meet its growing flour needs and enable the production of a wider product range and tailor-made flours. In addition the group is expanding capacity at its Shamrock Foods distribution operation.

The group produced a strong cash flow for the six-month period which increased to 17.03 cents per share from 14.1 cents. Basic earnings per share before exceptional items rose to 10.11 cents from 8.26 cents and shareholders are to get an interim dividend of 2.828 cents per share, up 15 per cent.

Turnover for the group, which operates in three divisions - food, agri-business and proteins and oils - was 15 per cent ahead at #441.24 million. With operating profits up 38 per cent to #20.6 million, operating margins improved to 4.68 per cent from 3.88 per cent.

The margin increase reflected increasing higher-margin food sales. Food now accounts for 40 per cent of turnover compared with 15 per cent four years ago, following a change of focus at the group. Changing working habits and growing demand for convenience foods boosted sales at Cuisine de France and Delice de France which was acquired in July. During the period, manufacturing capacity at the Dublin Cuisine de France plant was trebled, while the company expanded its range of products - to more than 300 - and its distribution capacity. Mr Martin said Cuisine had made good progress in its expansion into the US which began in May and is now supplying 130 outlets in downtown Chicago. "We have established that the concept is accepted there and this is an investment for the future," he said.

In the agri-business division, the group said it had held on to most of the gains following record demand last year. The fertiliser business in the Republic and in the UK following rationalisation performed well, but had a difficult season in mainland Europe. IAWS sees growth opportunities at the PB Kent horticultural fertiliser business in the UK .

Performance at the protein and oils division was described as satisfactory helped, by rising demand for fish feeds.